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    Valorem
    France

    Valorem

    Valorem is a leading independent renewable energy development and operating company. It is one of the largest onshore wind developers in France, having developed over 480MW of capacity over the last 10 years.

    The French power market is experiencing a major transition as it looks to reduce its reliance on nuclear generation and to increase generation from renewable sources of energy such as wind and solar. The energy transition has been continuously supported by the French governments over the past decade. With in-house capabilities across the entire project cycle and a strong local footprint, Valorem is well positioned to benefit from this shift in energy mix.

    Developments in the year

    Since acquisition in September 2016, Valorem has grown its existing onshore wind asset base from 142MW in operation to 216MW at the end of the period. In December 2017, Valorem closed the refinancing of the majority of its operational  wind portfolio, with a c.€180 million long-term non-recourse facility.

    The wind pipeline has also developed in line with expectations, with 24MW currently in construction and 700MW of advanced pipeline (fully permitted, approved but not yet clear of challenge, or with permit under instruction or preparation).

    During the year, Valorem has closed its first 36MW of photovoltaic (‘PV’) projects, and secured feed-in tariffs for an additional 88MW in the 2017 tariff auctions with an advanced pipeline of 250MW.

    Regulatory and political environment

    Renewables benefit from strong support from the French Government, which has an objective of a 32% renewables contribution by 2032 coupled with a carbonneutral electricity mix by 2040. In line with the need to triple the current installed PV capacity by 2023, in December 2017 the Government announced an increase of future PV auctions from 1.45GW to 2.45GW per annum over the next three years.

    Investment rationale

    This investment diversifies the Company’s portfolio with exposure to a growing renewables business in one of the most attractive European markets, and access to recurring, inflation-linked cash flows underpinned by a robust regulatory regime.

    Led by its experienced management team, Valorem is a best-in-class developer, being the fourth largest French wind developer and the largest independent one. It has a significant pipeline of projects at an advanced stage of development that it expects to convert into operating assets, with further projects at earlier stages to bring through the development process.

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